Forging America: The History of Bethlehem Steel - Chapter 2

Packer used $500,000 to found Lehigh University in South Bethlehem in 1865 as a private, Episcopal school to teach engineering. He, Sayre and others started St. Luke's Hospital in Fountain Hill in 1873 to care for workers injured on the railroad and in the iron plant. They provided a company store for the workers and their families, though not housing. They set up soccer clubs to encourage young men to take part in athletics. For girls, there was an Episcopal school, Bishopthorpe Manor.

The oligarchs' active role stemmed partly from semi-feudal ideals and concepts in pre-industrial America and the Episcopal Church.

In the 18th century and early in the 19th century, employers felt personally responsible for their apprentices or clerks. When the head of a business spoke of ''family,'' he meant his employees as well as his wife and children. He believed it was his duty to see that workers had a decent wage and a place to live and stayed warm in the winter. He took it on himself to care for their families.

That attitude was rooted in the medieval concept that a lord had to offer peasants protection in his castle in return for their willingness to farm his land and provide food.

When England began to industrialize, the system came under stress. The same thing happened when industry emerged in America.

As a devout member of the Episcopal Church, which was the American branch of the Church of England, Sayre was familiar with the spirit of obligation toward workers and abided by it. He and others in power sought a conservative ideal: Preserve the social contract between workers and owners as a means to promote a stable society.

Paternal leadership made sense in economic terms as well. Sayre believed that by providing a hospital, schools and athletics, the masters of industry were making their workers happy and more productive. They were also making the community a better place to live.

But noblesse oblige had its limits. The overriding one was that Bethlehem Iron's owners were not about to consult the workers about what was good for them. The owners said: This is what we're giving you. Defer to us, because we're your betters. We're educated and successful, and you're not, so we know what's best for you. Just follow our model and lead good Christian lives, and you'll be fine.

Bethlehem Iron's workers couldn't stomach that. They could see how well Sayre and his colleagues lived, while their own lot was to work long hours in savage heat and often deplorable conditions. The early iron- and steelmaking processes did not have electric power, so all machinery movement was steam-driven and hydraulic, which made for tedious and dangerous work. The men would go home dog-tired and pray that their aches and pains wouldn't keep them from the sleep they needed to work another day.

They weren't desperate, but they were poor. Because many were skilled tradesmen, they earned enough to provide the basics for their families, but couldn't afford the finer things. They paid rent to entrepreneurs and real estate speculators to live in houses within walking distance of the plant, or close enough to row a boat there.

With all that, they didn't want management shoving values down their throats.

Particularly troublesome for Sayre, judging from entries in his diaries, were the Irish, who had first come to South Bethlehem as laborers helping to build the railroad and made up a third of the borough's population. They would work intensively for a while, then walk off the job whenever they wanted. They didn't take well to paternalism, especially when it came from Episcopalians, whose attitudes seemed close to that of the English landlords they had fled Ireland to escape. And as Catholics, the Irish resented the view widely shared by Protestant Americans that they were a dangerous foreign influence.

Though someone like Sayre would never think of demanding that his workers join the Episcopal Church, the overwhelming impression left by church-related institutions of the time, such as Lehigh University and St. Luke's Hospital, was that the Episcopal Church was clearly superior to others.

Sayre might have contributed to that image through his visible commitment to the faith. When there was no church to attend, he invited fellow worshippers into his home for services, then founded the Church of the Nativity in the mid-1860s, as his father had founded St. Mark's in Mauch Chunk. And he taught Sunday school to workers every week, using two chapels, one at either end of the Bethlehem Iron plant.

Still, he would note in his diary at the end of a year that even though he had done well financially, his spiritual worth had fallen short.

''All going well with me except in a religious point of view,'' Sayre wrote on the last day of 1858. ''Have progressed backwards this year, I fear. Hope with God's help to do better next.''

Beyond matters of faith, Sayre and the other Bethlehem Iron directors did not limit workers' activities or behavior outside the plant. But inside, when it came to labor relations and unions, Sayre had little patience. In 1877, when Lehigh Valley Railroad workers joined a nationwide rail strike, Sayre ''went fishing'' until they returned to work on his terms, according to his diary.

He also adhered to a class system. For example, he protected Lehigh University boys who had gotten local girls pregnant. If they were working-class girls, they got nothing. If they were from middle-class families, as most were, Sayre arranged for them to have their babies in remote Bradford County, where he had tended mules many years earlier. The babies would be adopted, and the girls would return. They always got a cash settlement.

In 1879, Sayre lost his mentor. Asa Packer died in Philadelphia, leaving control of the railroad to his two sons, who squeezed Sayre out. ''The boys have come to scalp me and have brought the hatchet,'' he scrawled in his diary.

Dismissed three years later, Sayre wrote bitterly: ''I commenced work on the Lehigh Valley Railroad on May 11, 1852, and after serving it faithfully for 30 years I was finally given evidence of the desires of Judge Packer's family to get rid of me. So I have arrived at the conclusion that honesty and faithfulness do not count for much in this world.''